At the end of the year gone past, we did a rather interesting analysis of readership at Value Research. We analysed the data on page views of all the Q&A articles (our 'Ask Value Research' feature) we published on ValueResearchOnline.com, but not just in the conventional ways as one does for websites. Rather, we looked at the kind of investment problems that the articles tried to solve, specially with a view to what stage of investing knowledge would readers of various articles would be.
The results were quite interesting. The top two questions, whose popularity far exceeded anything else during the year about extricating oneself from legacy insurance policies. The policies were traditional ones, which are characterised by poor returns, inadequate coverage and lack of transparency. While this is true of practically any product (except term insurance) of the Indian insurance industry, LIC's giant legacy products are the biggest scale offenders.
Beyond insurance problems, the biggest area of concern is what one could call clarification and reinforcement of the very basics. Are Systematic Investment Plans always better than lump sum investments? Why should one invest in equity mutual funds instead of directly in stocks? Are liquid funds better than bank fixed deposits? Should one buy lots of funds or only a few? And so on.
These are basic questions, and in a way it's only appropriate that they should have the widest interest. Anyone who is interacting with investors know that while even shallow understanding of issues is not common, it's not for lack of trying. Investors are desperate for quality information and guidance and often don't chance upon a reliable source. The problem of financial literacy in India remains a relatively intractable one.